Housing

There are investors like the Wilsons all over Australia, who have built or bought disability homes where they are not needed, often under the guidance of property or investment advisers.

Property investment adviser Goro Gupta said part of the problem was that the NDIA — the agency that administers the policy — has not released clear data about where eligible people with a disability want to live.

That has meant many SDA houses have been constructed on the outskirts of capital and regional cities where the land is cheap.

"That's why, of course, the average investor wants to invest," Mr Gupta said.

At one estate in outer-western Melbourne, he was incredulous that so many houses for people with profound disabilities had been built.

"In these areas, there's a lack of amenities," he said.

"It's not close to shops, it's not close to the allied health services that people with disabilities need on a day-to-day basis.

"I mean, have a look at this area. It's paddocks."

For some investors who have overextended to build the homes, renting them out as a normal property is not an option because the returns are nowhere near enough to cover their mortgage repayments.

That means the homes are sitting empty in the hope that an eligible disability client will move in.

Some state governments were suspicious of the Commonwealth's desire to involve itself in housing supply, but the government still managed to secure their support to introduce a national scheme for subsidised rental housing.

The policy was less ambitious than housing reformers wanted, but it was better than nothing.

During the second reading debate on the legislation, a Labor MP from Tasmania, John Frank Gaha, told his parliamentary colleagues that he supported the CSHA "in its entirety". 

However, he said, he regretted the fact that constitutional limitations prevented the Commonwealth and states from taking a "wider view" of the role that housing played in the structure of the economy itself.

He said it made a huge difference to people's lives when they owned their own homes, especially in retirement.

He said it would be great if the government could devise a scheme to keep rents at a low level nationally, so some of the money that low-income families would otherwise spend on rent could be used to help them pay off a family home.

"In this way, we would make the average worker a capitalist; and that is our only solution to communism in this country," Dr Gaha said.

Just so, so angry:

Alix and her partner, Tiarn, are among the first tenants of a new public-private housing development the Victorian government is using as a template for its planned demolition and redevelopment of the state's 44 public housing towers.

Under the so-called Ground Lease Model, the state demolishes existing public housing blocks and leases the land to consortiums of private developers and non-profit housing providers for 40 years.

The consortiums then rebuild the sites with a mix of social, affordable and market-rate rentals, and hand them back to the government when the lease period expires.

The Flemington complex includes 240 community housing units and 116 affordable apartments for couples like Alix and Tiarn who earn less than $111,000 a year, and for single people earning less than $71,000.

But less than a year after they moved in, Alix and Tiarn were told by the consortium that operates their development that it had decided to increase their rent by 17 per cent.

"Since then, it's been nothing but stress and anxiety," Alix said.

The proposed increase would see the weekly rent for their one-bedroom apartment rise from $322 to $377 — an extra $55 the couple says they can barely afford.

So many bad ideas:

Reviewing the welfare payment for low-income renters is one of several ideas presented to Housing Minister Clare O'Neil after the election to reset Labor's housing agenda.

A table of contents which was accidentally sent to the ABC has revealed Treasury told Ms O'Neil and Treasurer Jim Chalmers the government's signature target of 1.2 million new homes in five years "will not be met".

[…]

Headings from the contents table show Treasury made nine "recommendations" of housing policies for Ms O'Neil to consider. While the materials do not include those recommendations in full, they give an extended glimpse at the department's focuses.

One of the nine recommendation areas focused on support for renters, listing several "policy reform opportunities" including a review of Commonwealth Rent Assistance, a supplement for welfare recipients who rent.

The supplement was increased by Labor in its first term, but economists and welfare advocates say it is still insufficient. Matthew Bowes, a Grattan Institute housing expert, told the ABC it should increase by 50 per cent for singles and 40 per cent for couples.

… which will just be a pass-through to landlords.

I disagree profoundly with Alan on restricting immigration, and the idea that we should encourage the involvement of superannuation funds in community housing (i.e. let's cure financialisation with more financialisation!), but the point that housing has to become a bad financial asset — and therefore good value as housing — is absolutely key.

Richard Yetsenga points out that there are 11 million dwellings in Australia, for 26.6 million people, which is theoretically enough. That suggests, he says, that the problem is misallocation rather than a genuine shortage.

Yes, but is the government going to force people to sell their holiday homes? And in any case, they are nowhere near employment or public transport so only useful as holiday homes.

The other problem with achieving more supply is capital.

The current plan is that it must be private capital because governments haven't got the money, because priorities have changed since the days of plentiful public housing.

But if affordability is to be improved, housing can't be a good investment.

To keep the current level of (un)affordability — that is, with house prices at nine to 10 times incomes, residential real estate has to be a poor investment, providing a return of no more than 3-4 per cent per annum, including rent, so incomes can keep pace.

To return to the affordability of 25 years ago — a house price to income ratio of four times, it would have to be an absolutely rubbish investment for 20 years with zero return.

That means private capital can't do it — only the government can.

Victoria is in its worst housing crisis since the Great Depression. This crisis is the direct result of respective governments neglecting housing despite being entirely aware of the sectors proliferating state of disrepair. Current housing minister Harriot Shing is not only complicit in this crisis, but actively an enabler, allowing her friends in big financial and real estate firms to profit from the suffering of the rest of the city.

Couldn't have put it better myself:

Powerful financial actors have done a great job at framing themselves as the solution to, rather than the cause of, the prevailing crisis. They have incessantly pushed the now-dominant narrative that more real estate investment is a good thing because it will increase the supply of much-needed homes. Blackstone, for example, claims to play a “positive role in addressing the chronic undersupply of housing across the continent”. But the evidence suggests that greater involvement of financial markets has not increased aggregate home ownership or housing supply, but instead inflated house prices and rents.

The thing is, institutional investors aren’t really into producing housing. It is directly against their interests to significantly increase supply. As one asset manager concedes, housing undersupply is bad for residents but “supportive for cashflows”. Blackstone’s president famously admitted that “the big warning signs in real estate are capital and cranes”. In other words, they need shortages to keep prices high.

Where corporate capital does produce new homes, they will of course be maximally profitable. Cities such as Manchester, Brussels and Warsaw have experienced a proliferation of high-margins housing products such as micro-apartments, build-to-rent and co-living. Designed with the explicit intention of optimising cashflows, these are both unaffordable and unsuitable for most households. Common Wealth, a thinktank focusing on ownership, found that the private equity-backed build-to-rent sector, which accounts for 30% of new homes in London, caters predominantly to high-earning single people. Families represent just 5% of build-to-rent tenants compared with a quarter of the private rental sector more broadly. These overpriced corporate appendages are a stark reminder of the market’s inability to deliver homes that fit the needs and incomes of most people.

[…]

In recent decades we have been living through an ever-intensifying social experiment. Can housing, a fundamental need for all human beings, be successfully delivered under the machinations of finance capitalism? The evidence now seems overwhelming: no.

As investors have come to dominate, so the power of residents has been systematically undermined. We are left with a crisis of inconceivable proportions. While we can, and should, point the finger at corporate greed, we must remember that this is the system working precisely as it is set up to do. When profit is the prevailing force, housing provision invariably fails to align with social need – to generate the types of homes within the price ranges most desperately required. In the coming years, housing will occupy centre stage in European politics. Now is the time for fundamental structural changes that reclaim homes from the jaws of finance, re-empower residents and reinstate housing as a core priority for public provision.

Housing Lawyer and author Nick Bano came by JOE Towers to chat about his new book Against Landlords: How to Solve the Housing Crisis which is out now. In this conversation we chat about Britain's housing setup, how is set up to create winners and losers and how to end the age of the landlord.

Some nice infographics based largely on census data, provided as a turnkey service for local government.

The 2025 Rental Affordability Snapshot surveyed rental listings across Australia and found that affordability has crashed to record lows. The Snapshot surveyed 51,238 rental listings across Australia and found that:

   352 rentals (0.7%) were affordable for a person earning a full-time minimum wage
   165 rentals (0.3%) were affordable for a person on the Age Pension
   28 rentals (0.1%) were affordable for a person on the Disability Support Pension
   3 rentals (0%), all rooms in sharehouses, were affordable for a person on JobSeeker
   No rentals were affordable for a person on Youth Allowance.

In response to the findings, Anglicare Australia is calling on the Government to return to directly funding and providing housing itself, instead of leaving housing to the private sector. Anglicare Australia is also calling on the Government to wind back landlord tax concessions.